How To Get A Business Loan

There are different types of business loans offered by banks and other creditors which you can choose from based on your business needs.

Determine amount to borrow

What type of financing are you going to use? Where will you borrow it from? You should answer these questions as well as remember that the financing method and its term of payment should match the reason why you are borrowing funds.

BONUS: Click here to download your FREE copy of our Ready, Set Business! Guide that shows you step by step how to start your own profitable business.

When figuring out how much money you need to borrow, you should be practical. Work out your initial start-up costs and assess when your business is likely to start becoming profitable and sustainable. You should be able to prove that regardless of unexpected interest rate increases or unanticipated lower sales, you can still repay the loan.

Download Your Guide The creditor will need the following information from you if you are just a new business who needs to apply for a loan:

  • Business product or service description
  • Marketing plans for how you promote your business
  • Proof of demand of your product or service

Information on your business and educational qualifications, previous ventures and achievements will be required as well.

The creditor should know the amount of funds you’ll need and what it is for. Payment terms should be clearly stated.

Sometimes you will also be required to provide your sales, profit, and cash flow projections, where loan repayments are reflected for generally a 12-month period.

The bank or financing firm would usually ask for collateral as a form of security on the loan. This will differ and depend on the type and amount of loan and will vary from every creditor. The following are commonly acceptable forms of security:

  • Real estate
  • Operating equipment
  • Business vehicles
  • Shares in public companies
  • Personal Guarantees

There is likely going to be a higher chance of approval on your loan if you also submit a Business Plan which includes the following information:

  • Your business goals and plans
  • Systems you plan to apply to facilitate checking your business and responding to changes in your financial position
  • Your market research results which support your target projections and estimated borrowings

Next Step

  • Make ready of your financial projections including cash flow forecast
  • Settle on your collateral or security
  • Prepare your Business Plan.

And don’t forget to grab your FREE copy of our Ready, Set Business! Guide that shows you step by step how to start your own profitable business. Get it here….

NOTE: This month we’re holding a limited number of Free Business Strategy Sessions designed to show business owners how they can manage and grow their enterprises with the least amount of cost and disruption possible.

Would you like to join us?

If you’d like to schedule one of these Free and obligation free sessions, let us know by email at hello@youraccountingpartners.com.au or call 07 3668 0646 and we’ll set things up for you.

James HuyVuong is a CPA and the owner of Your Accounting Partners. Partnering with businesses from start to scale thru to sale.

Posted on 15/03/2017 in Accounting Services

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About the Author

James Huy Vuong the Founder of Your Accounting Partners, a Brisbane based Business support agency. Specialising in providing bookkeeping, accounting, tax and compliance, business valuation and business sales services to local small business owners. His passion for business was evident very early on at the start of his career in accounting. He embarked on an unconventional path away from the traditional position with one of the big 4 accounting firms like most aspiring young graduate in his field. He decided instead through the lure a more diverse role, more pay and a much cooler title to work with Australia largest telco as a Business Specialist. He entered the world of business management and ownership in the hospitality industry for the invaluable hands-on experience one could not get just by reading textbooks, understanding debits and credits and passing exams. Huy has also spent a good part of a decade in the financial services industry owning and managing his family business which has lead him to start Your Accounting Partners. Your Accounting Partners sets out to help time-poor, frustrated business owners do better business by partnering with business owners on their ownership journey and making it together. Your Accounting Partners specialises in hospitality, service-base & professional services businesses. His mission is to help business owners use their business to give back to the family what it takes out. When it comes to business we say "You focus on what you do best, partnering with us and we'll take care of the rest".
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